Adani Power, BHEL, Suzlon, Waaree, IEX, Tata Power, CESC: Target prices, top 5 stock picks

JM Financial, in its Q1 review note on the power sector, said power utilities reported 12 per cent earnings growth, driven by elevated demand and a lower base. The brokerage said the sector continued to see a structural shift from thermal-led growth towards renewable energy, hydro, pumped storage projects, battery energy storage systems and nuclear, with NTPC Ltd, JSW Energy Ltd, Adani Power Ltd and Tata Power Company Ltd prioritising predictable returns over merchant opportunities.

Five power stocks to buy

Amid this backdrop, JM Financial said its top five picks were Adani Power with a target price of Rs 257, Emmvee Photovoltaic Ltd with a target price of Rs 402, BHEL with a target price of Rs 481, NTPC with a target price of Rs 413, and Adani Energy with a target price of Rs 2,018. 

It described Adani Power as expensive but the best earnings growth opportunity, Emmvee as a growth and valuation combination with rerating potential, BHEL as a massive earnings growth story backed by execution and operating leverage, NTPC as a risk-adjusted core utility at fair valuation with medium-term growth constraints, and Adani Energy as expensive but with high potential for earnings upgrades under its new business model.

On thermal generators, the brokerage said NTPC was focusing on diversifying its generation mix from thermal to renewable energy and hydro, with greater emphasis on sustainable gains through power purchase agreements rather than tactical merchant opportunities. It said nuclear remained in the early stages, with land sites identified, and that capex was set to rise from Rs 1.2 lakh crore a year to Rs 1.4 lakh crore a year, supported by an aggressive Rs 16.86 trillion capex plan and targeted installed capacity of 150GW by 2032 and 250GW by 2037. It also identified coal gasification as the next opportunity.

Targets for Adani Green, others

Among utilities, JM suggested a target of Rs 1,549 on Adani Green, Rs 2,018 on Adani Energy, Rs 660 on JSW Energy, Rs 1,515 on Torrent Power, Rs 199 on CESC and Rs 133 on IEX. 

JM Financial said JSW Energy was adopting a similar strategy, with capex focused on pumped storage projects and renewable energy, while securing supply chains and margins by building capacities in wind blade and battery energy storage system manufacturing. It said thermal generation at Adani Power remained strong, with the long-term capacity target increased from 42GW to 45GW. The brokerage added that the company remained focused on nuclear opportunities pending regulatory clarity through the SHANTI Bill, along with new hydel ventures.

Among renewable developers, JM Financial said capacity additions remained robust at Adani Green, which was increasing its focus on battery energy storage systems to capitalise on current arbitrage opportunities. It said the company retained ambitious targets of 50GW in renewable energy and 50GWh in battery storage, supported by a contract with Adani Energy Solutions for open battery storage capacity and a strategic shift from merchant gains to sustainable gains. It said profitability at ACME was driven by battery storage-related merchant gains, even as commissioning of renewable energy projects continued to be delayed. The company is targeting addition of 1.5GW of renewable energy in FY27, with none added so far, and 10GWh of battery storage, of which 3.6GWh has been added year to date. JM Financial said current battery storage arbitrage stood at Rs 7-9 per unit against a historical average of Rs 4-5 per unit.

Targets for Suzlon Energy, Waaree Energies, others

Among power equipment players, JM suggested a target of Rs 62 on Suzlon Energy Ltd, Rs 2,777 on Waaree Energies, Rs 88 on Inox Wind and Rs 1,320 on Premier Energies. 

On hydropower, the brokerage said incremental generation from NHPC's 1,000MW Subansiri and 800MW Parbati-II projects led to an improvement in performance. However, it said hydel generation was likely to remain relatively lower despite a seasonally strong Q2FY27 because of weak rainfall. It said regulated equity targets remained intact, with commissioning of new projects the key factor to monitor. For SJVN, it said thermal generation from the newly commissioned 1,320MW Buxar plant helped offset the slowdown in hydel generation and supported overall performance, while adding that it did not expect commissioning of any major project in the near term.

In transmission, JM Financial said Power Grid maintained its FY27 capex and capitalisation guidance at Rs 370 billion and Rs 300 billion, respectively, and remained positive on a strong bidding pipeline. It said the company expected equipment supply pressures to ease gradually because of capacity expansions, though it also said Power Grid lagged in execution despite strong capex and bidding visibility. The brokerage said Adani Energy had launched a new ESP platform for energy trading and reliable power supply solutions, while its transmission portfolio and smart metering business remained steady.

Targets for power stocks: Full list

Among distribution plays, JM Financial said Torrent Power's distribution business continued to limit thermal losses, while gas plant load factor remained subdued. It said renewable energy additions remained muted and that benefits from the Nabha acquisition were expected to be realised from the next quarter, with the current quarter contribution limited to six days. For CESC, the brokerage said the company was focusing on building renewable energy capacities for its renewable purchase obligation requirements as well as cost advantages in the distribution business. It said CESC had acquired renewable energy assets from ReNew, with the transaction set to close in October 2026, while its traditional generation and distribution businesses remained steady. Greater visibility on future renewable energy capacity additions, it said, supported the growth outlook.

On integrated players, JM Financial said Tata Power maintained its targets for renewable energy and pumped storage projects as it continued to shift from thermal to clean energy. It said the Odisha discoms and cell and module business remained strong, though they were close to peak performance, while rooftop solar growth continued steadily. Excluding Mundra, it said execution of the large under-construction pipeline of 5.3GW of renewable energy and 4.5GW of pumped storage and hydro remained the key factor for performance going forward.

In equipment, the brokerage said BHEL was at an inflection point as execution picked up and operating leverage improved. It said BHEL posted a profitable Q1FY27 after eight financial years, while order book momentum and collections remained healthy during the quarter. The order book stood at Rs 2.6 trillion, up from Rs 2 trillion at the end of June 2025.

On solar equipment makers, JM Financial said in-house cell facilities were proving to be a competitive advantage even as the nDCR segment turned unprofitable. It added that nDCR order inflows were still rising because of the extension of the ALMM List-II deadline. Emmvee and Premier, it said, maintained margins of 35% and 30 per cent in Q1FY27 against 32.8 per cent and 30 per cent in Q4FY26 because of stabilised cell manufacturing facilities. In contrast, Waaree and Vikram saw margin pressure, with margins at 14 per cent and 8 per cent in Q1FY27 against 18 per cent and 16 per cent in Q4FY26, due to low integration or no integration.

For wind equipment players, JM Financial said tendering and ordering were picking up, but commissioning continued to lag deliveries and competition from Chinese original equipment manufacturers was increasing. It said order books were expanding for both Suzlon and Inox Wind, at 6.1GW and 4.4GW respectively. Suzlon, it said, saw margin compression because of the rising share of EPC mix, with margin at 16 per cent in Q1FY27 against 19 per cent in Q1FY26. Inox Wind posted a broad miss because of a lack of executable orders and execution challenges, though management described this as transitional due to business restructuring and emphasised recovery from the second half of FY27.

JM Financial also flagged pressure points in the sector, saying Coal India faced structural margin and production pressure, while IEX faced regulatory uncertainty from market coupling. Overall, the brokerage said the sector was moving towards cleaner and more predictable return streams, with Adani Power remaining the strongest thermal earnings growth story, Adani Green scaling up aggressively in renewable energy and battery storage, hydro players facing near-term generation constraints, and execution of large renewable energy and pumped storage pipelines emerging as the key variable across utilities and equipment makers.